Last month, the busted Bear Stearns banker allegedly tried to get his hands on loan documents in Florida, ahead of a subpoena.

NEW YORK (Fortune) -- The much awaited trial of Ralph Cioffi and Matthew Tannin, the managers of two failed Bear Stearns hedge funds that sparked a market meltdown during the summer of
2007, looks like it will have a new twist when it gets underway on October 13. One of the defendants, Ralph Cioffi, made a lightening-fast trip to Florida last month allegedly to get his
hands on a key piece of evidence -- documents from Busey Bank, in Ft. Myers, Fla. Was the hedge fund manager engaging in a cover-up, as the U.S. Attorney's Office in Brooklyn asserts? Or
was Cioffi merely up to a bit of amateur detective work to exonerate himself, as his defense attorney claims?

The implication that Cioffi was operating "without any decent restraint" (as General Corman said of Colonel Kurtz in "Apocalypse Now") surfaced as part of Assistant U.S. Attorney James
McGovern's efforts to improve the government's case before the trial gets underway. The outcome of the trial, legal experts think, will come down to whether a jury believes that Cioffi
and Tannin intentionally misled investors about the deteriorating condition of their two hedge funds -- the High-Grade Structured Credit Fund and the Enhanced Leveraged Fund -- or whether
the two bankers used colossally poor investment judgment but did nothing criminal, as their attorneys counter.

In a letter McGovern sent to Judge Frederic Block on August 18, the prosecutor urged the judge to allow the government to introduce at the trial "prior uncharged acts of Defendant Ralph
Cioffi" as "relevant evidence" that Cioffi knowingly engaged in "insider trading." One of the counts in the indictment charged Cioffi with insider trading when he "redeemed $2 million
worth of his holdings in the Enhanced Fund based on material, non-public information" -- information that the fund's assets were losing value and could fail.

In his letter to the judge, McGovern said, "The government will prove that the defendant redeemed his investment in the Enhanced Fund so that he could re-invest the $2 million in another,
more profitable fund under his control." Cioffi's attorneys counter that the hedge fund manager did not engage in insider trading when he shifted the $2 million but rather simply moved a
portion of his overall money invested in the hedge funds into the new fund that Bear Stearns asked him to run. Investors want to see that the manager of a hedge fund has skin in the game,
Cioffi's attorneys contend, and that is all Cioffi was doing when he moved the $2 million.

Moving his money out of one hedge fund he managed into another, less toxic hedge fund he managed does not look good but Cioffi's quick, unexpected trip to Florida on September 18 looks
worse, if McGovern is right about Cioffi's motives for the trip. To strengthen the government's characterization of Cioffi as a rogue, McGovern cited Cioffi's "attempt, in late 2006" to
"pledge his investment" in the Enhanced Fund as collateral for a $4.25 million line of credit from Busey Bank, in Ft. Myers, Fla. The line of credit was for a "luxury condominium complex"
in Sarasota, Fla., that Cioffi and his brother were building. The loan was necessary, the government alleged, for the project to be completed.

When Cioffi informed his superiors at Bear Stearns' Asset Management division (known as "BSAM") of his intention to pledge his interest in the hedge fund as collateral for the loan, he
was denied permission to do so. "Upon learning of BSAM's decision not to allow him to use his stake in the Enhanced Fund as collateral, Cioffi became extremely upset and accused the
general counsel of BSAM of being behind the decision."

McGovern wrote that because of the scrutiny Cioffi received from BSAM regarding the Sarasota loan, he then knowingly concealed his transfer of the $2 million from BSAM management because
he knew that if he asked them for permission, it would have been denied. "Furthermore, this evidence will refute any argument Cioffi may make...that there is an innocent explanation for
his behavior," he wrote.

In the wake of McGovern portraying Cioffi's line of credit from Busey Bank as a smoking gun, prosecutors issued a subpoena for the documents last month. During the same time period, the
government alleges, Cioffi undertook some curious behavior in his own attempt to get the original copies of the loan documents from Busey Bank officials. On September 8, the government
claims, Cioffi called a Busey Bank employee and asked her to locate the loan records. On September 16, Cioffi called her again and offered to accompany her to the "bank's storage
facility" to look for the documents since he "would be traveling to Florida." On September 17, the government informed the federal court about the subpoena it had issued to Busey Bank
about the Cioffi loan documents.

The next day, September 18, Cioffi flew to Florida to try to get the documents. In an alleged voicemail message left for a bank employee, Cioffi said: "Jen, Hi, Ralph Cioffi calling, it's
Friday morning, it's 8:30 a.m., I'm actually on my way to Ft. Myers from Newark Airport, New Jersey. I land about 12:15. I'll call you when I land. I was hoping to in the meantime you
might have been able to find the file and if you had, I would love to come by and get a fax copy of the document or the document itself. In any event, my number is [number redacted], if
in fact you wanted to call me and leave me a message one way or another. If I don't hear from you I'll check in when I land. Thanks."

When a bank employee informed Cioffi that his original loan documents had not yet been located, Cioffi asked that the originals be sent by "Federal Express to his residence in Tenafly,
New Jersey."

In a September 22 letter to Judge Block, the U.S. Attorney's office in Brooklyn wrote that "Cioffi's attempt to take possession of the original documents before Busey Bank could turn them
over to the government, pursuant to a valid federal subpoena, is troubling and could have impeded the government's ability to obtain the original loan documents. Such conduct, depending
on the defendant's motive, may be punishable as a felony under federal law."

When Cioffi was arrested on June 19, 2008, he was released on a bond secured by $4 million of his assets. His travel was restricted to the continental United States and his passport was
taken from him. A review of Cioffi's "conditions of release," the government wrote "in light of this conduct is appropriate..." including restricting his travel solely to New York and New
Jersey.

In its own memorandum filed with the federal court on September 22, Cioffi's attorneys at Williams & Connolly, claimed that the government had "its facts wrong" and that Cioffi had
obtained the necessary approvals from Bear Stearns to pledge a portion of his investment in the hedge funds as collateral for the Florida loan. "Thus there is no question that, contrary
to the government's allegations, BSAM vetted and approved Mr. Cioffi's pledge of his interests in the Enhanced Fund as collateral for the Florida loan," his attorney wrote. As for
Cioffi's fishing trip to Florida, Williams & Connolly wrote that it was "preposterous for the government to suggest that it was 'obstruction' for Mr. Cioffi to seek a copy of the bank
records that vindicate him."

So perhaps Mr. Cioffi was indeed playing Nancy Drew and trying to find records that will clear him. Only the trial will tell.